- GBPUSD 1.6231 defines trend
- AUDUSD .7925 defines trend
- NZDUSD .6341 defines trend
- USDCAD terminal thrust from triangle
- USDCHF decline from 1.1026 an impulse; resistance at 1.0930
Euro / US Dollar
Trading above 1.4140 shifts odds in favor of the bullish count in which the decline from 1.4340 is an A-B-C correction that will be fully retraced. Under this count, the rally from 1.3750 is wave 5 of an ending diagonal from 1.2454. The rally from 1.3750 itself is unfolding as a diagonal and price must stay above 1.3887 in order to keep this count valid. The bearish count is not completely eliminated as no rules have been broken (see the alternate numbering) but its prospects are damaged given the time taken up by what would be wave ii. From a trading perspective, ST may want to short here, targeting support at 1.3900.
British Pound / US Dollar
I wrote yesterday that “although evidence favors a top and reversal, the GBPUSD has yet to confirm as much. An alternate, in which Cable will trade higher in a 5th wave terminal thrust, is gaining more credibility each passing day.” The rally from 1.6231 is in 3 waves but could be wave i of an ending diagonal in the wave v position. Staying above there keeps the trend pointed up and there potential support at 1.6430.
Australian Dollar / US Dollar
The AUDUSD decline from .8269 is corrective in nature therefore odds favor a rally through that level prior to a top and reversal. The rally through .8124 favors bulls and the trend is bullish as long as price is above .7925.
New Zealand Dollar / US Dollar
My focus remains on the longer term structure, especially the rally from .4890, which is a textbook zigzag. Waves A and C are equal (and price reversed at the 50% retracement of the decline from .8219), which is common. However, the uneasy sentiment remains here since the recent decline is more corrective than impulsive.
US Dollar / Japanese Yen
The triangle continues to play out but there is an alternate bearish count in which the drop from 101.50 is a series of 1st and 2nd waves. 93.50 defines the trend (above is bullish and below is bearish). Watch for potential resistance at 97.20 (6/19 high).
US Dollar / Canadian Dollar
This is a potential short term count for the USDCAD. The implications are bullish over the next several months (and beyond) but bearish over the next several weeks. Under this count, a 5th wave would complete the rally from 1.0782 and give way to a multi week and potentially deep correction of the rally from 1.0782. Watch for resistance at 1.1820.
US Dollar / Swiss Franc
The USDCHF short term pattern is the clearest of all the USD crosses. As mentioned in recent days, the rally from 1.0589 is a 3 wave correction that should be fully retraced. Confirming that the larger trend is still down is the 5 wave decline from 1.1026. Expect strength to 1.0930 or so (former 4th wave and Fibonacci) before the next leg down begins.
Jamie Saettele publishes Daily Technicals every weekday morning (930 am EST), COT analysis (published Monday mornings), technical analysis of currency crosses throughout the week (EUR on Tuesday, JPY on Wednesday, GBP on Thursday, AUD on Friday), and the DFX Trend Index every day after the NY close. He is also the author of Sentiment in the Forex Market.
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